Advantages of floatation of new shares, Finance Basics

Advantages of Floatation of New Shares

1. It facilitates the matter of securities to increase new finance, creation a company less dependent on retained earnings and banks.

2. The wider share ownership that results will raise the likelihood of being capable to compose rights issues.

3. The transfer of shares becomes much easier. Less of a commitment is essential on the part of shareholders. For this cause the shares are likely to be perceived like a less risky investment and thus will contain a higher value.

4. The greater marketability and thus lower risk attached to a lower cost to a market listing will lead of equity and to a weighted average cost of capital also.

5. a market-find out price because shareholders will distinguish the value of their investment all times.

6. The share price can be utilized via management as a sign of performance, particularly while the share price is forward looking, individually based upon expectations, even as other objectives measures are backward looking.

7. The shares of a quoted company can be utilized more readily like consideration in takeover bids.

8. The company may raise its standing via being quoted and it may get greater publicity.

9. Getting a quotation provides an entrepreneur along with the opportunity to realize part of his holding in a company.

Posted Date: 2/1/2013 1:38:32 AM | Location : United States







Related Discussions:- Advantages of floatation of new shares, Assignment Help, Ask Question on Advantages of floatation of new shares, Get Answer, Expert's Help, Advantages of floatation of new shares Discussions

Write discussion on Advantages of floatation of new shares
Your posts are moderated
Related Questions
As the Chief Financial Officer for the wholly Australian owned, Australian Stock Exchange listed company, Toy Show Ltd., an importer and manufacturer of a range of quality children

Question 1 a) What are the main characteristics of an Efficient Tax system? b) What are the instruments of Public Finance and explain their efficiency. c) Explain what

The director of capital budgeting for a firm has identified two mutually exclusive projects, A and B, with the following expected net cash flows: Expected Net Cash Flows Year

Bases of Share Valuation Share valuation can be done on the basis of income and asset values. On the basis of income still a share will be entitled to two forms of income. For

Why are financial institutions heavily regulated, with specific focus on their ability to increase or reduce the money supply?

Sole Proprietorship Definition - A sole proprietorship or sole tradership is the oldest and simplest form of business. It is that type of business organization where one person

Earning method - Bases of Valuation The business is valued according to the net stream of income it is expected to create over its lifetime. Determination of maintaina

Determine the Component of Return Rate of return from an investment consists of the two: (i) Yield: Interest or dividend received is called yield. (ii) Capital Appreci

ksklklsdfmklsnakakngjkalkgblakbgklabgklagkbaskgbljas a kalks las lgaskgbak a lv aslglaksglas la sla

State the Realised and Expected Return Return is not as simple a notion as it appears to be as it's not guaranteed, it is mostly expected, and it may or may not be realized.